Dario Perkins
@darioperkins
MD Global Macro @TS_Lombard, macro themes/research/risks, central-bank specialist, started career at HM Treasury in late 90s, ex ABN AMRO, AC Milan fan
2.6K Following 77.2K Followers
Heard on Bloomberg: "maybe Warsh is the new Volcker".
Let's not get carried away.
Only took 25bps to change the narrative though.....
Everyone: the Fed cant hike v much
Also everyone: rate hikes wont cause any damage
🤷♂️
Damn. This is the most detailed map of Big AI’s incestuous relationships I’ve seen so far. And it’s interactive!
remember this? I like to think if Volcker was still around, he would have called Warsh today. "Congratulations - you are now a proper central banker"
When Greenspan came in, he immediately hiked rates. Volcker phoned him and jokingly called him a "traitor". He was supposed to be friendly to the administration. It would be funny if Warsh was forced to hike and Powell pulled the same joke. More likely Trump calls though... 🤣
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So under political pressure about QT, the Bank is basically handing the entire problem over to the Treasury - so the Treasury can pull a Bessent? They are all as bad as each other...
Watching the press conference back, it looks like Warsh has realised that central banking isnt about punditry and clever soundbites, and has decided to take the job seriously....
easy: "these guys are political - they will vote for a hike anyway" and "if I dont go along with it, the bond market could take it very badly..." [Bessent nods sagely]
@darioperkins Okay, assuming Warsh informed President Trump about the interest rate hike beforehand—But I wonder how did the Fed Chair justify the decision? "It’s not me, it’s the economy, stupid! " .. (??)
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Warsh citing the economy's strength to justify the hike was a bit like the man on the street who, are tripping slighty, does that long, staggered jog to hide his embarrassment...
Looks like he finally figured out the job
The main gear shift for Fed Chair Warsh between when he took office in late May and now is that he talks much more freely about the current state of the economy.
The sock puppet narrative just died, as it should. Or maybe the bond market is just scarier than the President 🤣
My guess is that the Fed just started on a quarterly hiking path and the terminal rate will be decided by how far the jobs market rebounds.. 50bps minimum but personally I'd bet on more
I'm just disappointed the vote wasnt 11-1 🤣
My guess is that he has already briefed Trump so this wont be a surprise
@darioperkins I haven't felt like this in YEARS.
Warsh famously doesn't give forward guidance, but if he did, he would have just signalled a September hike.....
If Kevin Warsh was an automobile, which brand/model would he be? What about Lagarde? Bailey?
This is THE MOST PERFECT summary of what we are watching
Oh great, now im going to a bloody Arsenal championship party on Sunday 🙄
